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Home»Adoption»US banks just unlocked a loophole to profit from your crypto trades without holding the bag
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US banks just unlocked a loophole to profit from your crypto trades without holding the bag

December 14, 2025No Comments9 Mins Read
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On Dec. 9, the Office of the Comptroller of the Currency put out a press release with a very direct message for US banks: you are allowed to sit in the middle of crypto trades.

In the memorably titled News Release 2025-121, the OCC published the somehow even worse-titled Interpretive Letter 1188 and confirmed that national banks may run “riskless principal” crypto-asset transactions as part of the business of banking, acting as the buyer to one customer and seller to another, while keeping no meaningful inventory of tokens themselves.

A day earlier, Comptroller Jonathan Gould stood before a room of industry participants and made a different, but closely related, point.

He said he saw no reason to treat digital assets as a separate species when it comes to custody and safekeeping, and he brushed aside a lobbying push from the Bank Policy Institute, which has urged his agency to block a wave of crypto firms from obtaining national trust charters.

BPI’s campaign, laid out in an October statement titled “BPI Urges OCC to Preserve the Integrity of National Trust Charters,” argues that applicants like large exchanges, stablecoin issuers, and fintech platforms want to use trust charters as a back door into bank-like activities without carrying the full load of deposit insurance and holding-company supervision.

Taken together, the interpretive letter and Gould’s remarks outline a clear direction for the industry’s future. The OCC is not trying to wall crypto off from the banking system, but trying to work out which pieces of that activity fit within familiar categories like brokerage, custody, and fiduciary business, and under what conditions.

US banks now have explicit comfort that they can match crypto trades for clients on a riskless principal basis, and crypto companies can see that the door to a national trust charter isn’t closed just because their assets move on blockchains rather than through legacy securities depositories.

Who actually runs this part of the banking system

For anyone outside the United States, the alphabet soup of bank regulators can feel like an elaborate puzzle, so it is worth starting with the basics.

The Office of the Comptroller of the Currency (OCC) is an independent bureau within the US Treasury that charters, regulates, and supervises national banks and federal savings associations, as well as the federal branches and agencies of foreign banks.

It earns its living from assessments and fees on the banks it oversees rather than from annual congressional budgets, which gives it a degree of insulation from short-term political fights over funding. Its mandate runs through safety, fair access to financial services, and compliance with banking law.

The Comptroller of the Currency sits at the top of this structure. Gould, sworn in this summer, serves both as the OCC’s chief executive and as a member of bodies such as the Federal Deposit Insurance Corporation board and the Financial Stability Oversight Council, which means his views reach into broader debates about financial stability and market plumbing.

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His core power, though, is very specific: he leads the agency that grants national bank charters.

A bank charter in this context is essentially a business license that permits an institution to operate as a bank or a closely related entity under federal law. At the federal level, the OCC manages these licenses; at the state level, separate regulators issue their own versions.

The OCC’s Licensing Manual on charters details the process thoroughly, from initial application to final approval. Organizers must demonstrate that their proposed bank has sufficient capital, a credible management team, a business plan capable of withstanding stress, and risk controls covering everything from basic credit risk to operational and cyber risks.

New digital-only banks are expected to meet the same standards, with added scrutiny on technology and third-party providers.

Within that world, a national trust bank occupies a narrow but important niche. Federal law allows the OCC to charter a national bank whose activities are limited to those of a trust company and related services, typically focused on acting as trustee, executor, investment manager, or custodian of assets.

These entities usually don’t take deposits in the ordinary retail sense and often do not carry FDIC insurance. Because of that structure, many national trust banks do not meet the definition of a “bank” under the Bank Holding Company Act, which means their parent companies can avoid the full weight of consolidated holding-company supervision.

That legal design explains why trust charters have become the focus of a tug-of-war. For crypto firms that want to hold customers’ tokens, manage stablecoin reserves, or sit at the center of settlement flows without becoming full commercial banks, a national trust charter offers three things at once: a federal supervisor, nationwide reach, and a path that may stay outside holding-company rules.

For traditional banks and their trade groups, that looks like an uneven playing field, especially if new entrants can handle large volumes of payments and reserves with a narrower licence.

BPI’s letters to the OCC spell out exactly this worry, warning that trust charters were historically intended for institutions “predominantly engaged in trust and fiduciary activities.” At the same time, some digital-asset applicants seek to run broader payment and reserve businesses.

Gould’s public line has been that technology shouldn’t be the dividing line. He points back to decades of electronic custody and book-entry securities. He asks why holding cryptographic claims on a distributed ledger should be treated as alien to the banking business.

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That same logic underlies Interpretive Letter 1188, which relies on earlier court cases and OCC opinions to argue that riskless principal crypto-asset trades are both the functional equivalent of recognized brokerage activity and a logical extension of existing crypto custody services.

What this means for crypto custody and trading

The new letter does one very immediate thing for US institutions: it tells national banks that they may stand in the middle of customer crypto trades, so long as they structure those trades as matched principal transactions and manage the risks with the same care they would apply to securities.

The bank can buy a digital asset from one customer and immediately sell it to another, booking two offsetting positions that leave it with no net exposure beyond settlement and operational risk.

For tokens that count as securities, this sits on well-worn ground under section 24 of the National Bank Act. For other crypto-assets, the letter walks through a four-factor test and concludes that the activity still fits within the “business of banking.”

For large banks that have kept crypto at arm’s length, that represents a practical opening. It means they can build customer-facing crypto brokerage and routing services that keep balance sheet risk to a minimum, rather than dabbling through loosely connected affiliates or leaving the field entirely to exchanges.

It also sits atop earlier OCC letters that already described how banks may hold stablecoin reserves and provide basic custody services for crypto.

On the charter side, Gould’s refusal to give BPI the blanket answer it wanted may matter even more for the market’s shape over the next few years. The OCC’s charter manual reminds applicants that any limited-purpose trust bank must still satisfy the same core standards of capital, management, risk control, and community needs as a full national bank.

If the agency starts approving digital-asset firms that meet those tests, the core of US crypto custody and settlement could migrate into national trust banks that wear OCC supervision on their masthead.

For exchanges, that would create a route to offer institutional clients a vertically integrated stack: trading, fiat settlement, and on-chain custody, all wrapped inside a federally supervised entity.

For stablecoin issuers, a national trust bank could hold reserves in an OCC-regulated balance sheet and run payment flows through Fed-connected correspondent networks, even if the issuer itself stays outside the complete bank framework.

For prime brokers and asset managers, the phrase “OCC-supervised national trust bank” on a due diligence checklist looks very different from “state-chartered trust company” or “non-US custodian,” especially when US securities rules push them toward “qualified custodians” for digital assets in the same way they do for stocks and bonds.

See also  CySEC Confirms February Deadline for Crypto Firms Seeking MiCA Approval

The flip side is that trust charters will not be an easy win

BPI and other commenters have been busy feeding detailed objections into the OCC’s docket for specific applicants, arguing that some crypto platforms have thin consumer-protection records, conflicts in their business models, or opaque ownership structures that don’t sit well with bank-level oversight.

The OCC has broad discretion under its charter rules to weigh management quality, financial strength, and community benefits, and it can attach bespoke capital or liquidity conditions to any trust bank approval. That means the real filter for crypto firms will sit in examination teams and supervisory agreements, not just in headline speeches.

Globally, the direction set in Washington tends to echo outward. Large banks that operate across continents often look to US rules when deciding where and how to build new lines of business, and foreign regulators watch the OCC closely because its decisions shape the behaviour of some of the world’s largest balance sheets.

If US national banks start offering riskless principal routing for Bitcoin and Ethereum under clear OCC guidance, that will influence how global clients expect these services to look in London, Frankfurt, or Singapore.

If a handful of crypto firms secure national trust charters and run large custody and stablecoin operations under federal supervision, that will present a very different model from the offshore exchange-and-local-payment-partner approach that has defined much of the past decade.

The message for the crypto industry here isn’t that the US banking system has thrown the doors wide open, because it hasn’t.

It’s instead that the key regulator for national banks has begun to pin parts of the crypto business to concrete regulatory hooks: brokerage-like trading as riskless principal, custody as a modern form of safekeeping, trust charters as a home for fiduciary and reserve activity.

In a market where regulatory uncertainty is the main business risk, that sort of gradual, line-by-line clarification can be just as crucial as any splashy new law.

Crypto firms that want to plug into US institutional money now have a clearer picture of the homework they need to do. Banks that want to move beyond white-label products can see where their own supervisors are willing to draw the lines.

How quickly both sides walk through that opening will decide whether OCC Letter 1188 and Gould’s speech mark the start of a new era of bank-run crypto plumbing or just another brief entry in the long history of regulators testing where digital assets fit within existing rules.

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